Economist Says Fed Warning Shows Trump Driving US Economy 'Toward Disaster'
"Launching chaotic trade wars with our allies and gutting Social Security, Medicaid, and other vital programs in order to fund tax breaks for his billionaire donors isn't making life more affordable for working-class families."
U.S. Federal Reserve Chair Jerome Powell speaks at a news conference after a meeting of the Federal Open Market Committee on Wednesday, March 19, 2025 in Washington, D.C.
(Photo: Tom Williams/CQ-Roll Call, Inc. via Getty Images)
Brett Wilkins
Mar 19, 2025
COMMON DREAMS
A former Obama administration economic adviser said Wednesday that the Federal Reserve's forecast of increased unemployment, accelerating inflation, and slower growth driven by President Donald Trump's economic policies could portend a return of the "stagflation" that plagued the nation in the 1970s.
The Federal Open Markets Committee, which sets U.S. monetary policy, downgraded its economic outlook for 2025 from an initial projection of 2.1% growth to 1.7%. FOMC also revised its inflation forecast upward from 2.5% to 2.8%.
While FOMC said that "recent indicators suggest that economic activity has continued to expand at a solid pace," the committee noted that "uncertainty around the economic outlook has increased."
Fears of an economic slowdown or even a recession have increased dramatically since Trump took office and imposed tariffs on some of the nation's biggest trade partners while moving to gut critical social programs in order to fund a $4.5 trillion tax cut that will overwhelmingly benefit wealthy Americans.
"Inflation has started to move up now. We think partly in response to tariffs and there may be a delay in further progress over the course of this year," Federal Reserve Chair Jerome Powell said during a Wednesday news conference, at which he said interest rates will remain unchanged. "The survey data [of] both household and businesses show significant large rising uncertainty and significant concerns about downside risks."
The economic justice group Groundwork Collaborative said the FOMC projections show that "Trump is steering our economy toward disaster," while warning of the possible return of stagflation, a combination of low or negative economic growth and inflation.
Alex Jacquez, the chief of policy and advocacy at the Groundwork Collaborative and a former adviser at the White House National Economic Council during the Obama administration, said in a statement that "the Federal Reserve's projections confirm what millions of Americans are already thinking: President Trump is steering our economy toward disaster."
"Voters elected President Trump to lower the cost of living, and instead, they continue to be saddled with persistently high inflation and interest rates," Jacquez continued. "Launching chaotic trade wars with our allies and gutting Social Security, Medicaid, and other vital programs in order to fund tax breaks for his billionaire donors isn't making life more affordable for working-class families. It is, however, a perfect recipe for stagflation."
Trump's economic policies—which some observers believe could be designed to deliberately tank the economy so that the ultrawealthy can buy up assets at deep discounts—have sent consumer confidence plummeting. Meanwhile, recent polls have revealed that a majority of voters disapprove of Trump's handling of the economy and inflation.
The latest FOMC forecast came as the world braces for yet another escalation of Trump's trade war, with the president threatening to implement worldwide reciprocal tariffs starting April 2.
The Organization for Economic Cooperation and Development (OECD) said Monday that Trump's trade war is likely to slow economic growth in the United States and around the world.
"The global economy has shown some real resilience, with growth remaining steady and inflation moving downwards," OECD Secretary-General Mathias Cormann said. "However, some signs of weakness have emerged, driven by heightened policy uncertainty."
"Increasing trade restrictions will contribute to higher costs both for production and consumption," Cormann added. "It remains essential to ensure a well-functioning, rules-based international trading system and to keep markets open."
"Launching chaotic trade wars with our allies and gutting Social Security, Medicaid, and other vital programs in order to fund tax breaks for his billionaire donors isn't making life more affordable for working-class families."
U.S. Federal Reserve Chair Jerome Powell speaks at a news conference after a meeting of the Federal Open Market Committee on Wednesday, March 19, 2025 in Washington, D.C.
(Photo: Tom Williams/CQ-Roll Call, Inc. via Getty Images)
Brett Wilkins
Mar 19, 2025
COMMON DREAMS
A former Obama administration economic adviser said Wednesday that the Federal Reserve's forecast of increased unemployment, accelerating inflation, and slower growth driven by President Donald Trump's economic policies could portend a return of the "stagflation" that plagued the nation in the 1970s.
The Federal Open Markets Committee, which sets U.S. monetary policy, downgraded its economic outlook for 2025 from an initial projection of 2.1% growth to 1.7%. FOMC also revised its inflation forecast upward from 2.5% to 2.8%.
While FOMC said that "recent indicators suggest that economic activity has continued to expand at a solid pace," the committee noted that "uncertainty around the economic outlook has increased."
Fears of an economic slowdown or even a recession have increased dramatically since Trump took office and imposed tariffs on some of the nation's biggest trade partners while moving to gut critical social programs in order to fund a $4.5 trillion tax cut that will overwhelmingly benefit wealthy Americans.
"Inflation has started to move up now. We think partly in response to tariffs and there may be a delay in further progress over the course of this year," Federal Reserve Chair Jerome Powell said during a Wednesday news conference, at which he said interest rates will remain unchanged. "The survey data [of] both household and businesses show significant large rising uncertainty and significant concerns about downside risks."
The economic justice group Groundwork Collaborative said the FOMC projections show that "Trump is steering our economy toward disaster," while warning of the possible return of stagflation, a combination of low or negative economic growth and inflation.
Alex Jacquez, the chief of policy and advocacy at the Groundwork Collaborative and a former adviser at the White House National Economic Council during the Obama administration, said in a statement that "the Federal Reserve's projections confirm what millions of Americans are already thinking: President Trump is steering our economy toward disaster."
"Voters elected President Trump to lower the cost of living, and instead, they continue to be saddled with persistently high inflation and interest rates," Jacquez continued. "Launching chaotic trade wars with our allies and gutting Social Security, Medicaid, and other vital programs in order to fund tax breaks for his billionaire donors isn't making life more affordable for working-class families. It is, however, a perfect recipe for stagflation."
Trump's economic policies—which some observers believe could be designed to deliberately tank the economy so that the ultrawealthy can buy up assets at deep discounts—have sent consumer confidence plummeting. Meanwhile, recent polls have revealed that a majority of voters disapprove of Trump's handling of the economy and inflation.
The latest FOMC forecast came as the world braces for yet another escalation of Trump's trade war, with the president threatening to implement worldwide reciprocal tariffs starting April 2.
The Organization for Economic Cooperation and Development (OECD) said Monday that Trump's trade war is likely to slow economic growth in the United States and around the world.
"The global economy has shown some real resilience, with growth remaining steady and inflation moving downwards," OECD Secretary-General Mathias Cormann said. "However, some signs of weakness have emerged, driven by heightened policy uncertainty."
"Increasing trade restrictions will contribute to higher costs both for production and consumption," Cormann added. "It remains essential to ensure a well-functioning, rules-based international trading system and to keep markets open."
Corporate CEO paychecks continuing to go gangbusters while the corporations these execs run are—at best—just treading water.
U.S. President Donald Trump and Tesla CEO Elon Musk (AND MINI ME MUSK) speak to the press as they stand next to a Tesla Cybertruck on the South Portico of the White House on March 11, 2025 in Washington, D.C.
(Photo: Mandel Ngan/AFP via Getty Images)
Sam Pizzigati
Mar 20, 2025
Inequality.org
Every day’s headlines now seem to bombard us with ever more outrageous Trumpian antics. Who could have possibly imagined, for instance, that a president of the United States would turn the White House lawn into a Tesla auto showroom?
But these antics actually do serve a useful social and political purpose—for President Donald Trump’s fellow deep pockets and the corporations they run. Trump’s kleptocratic arrogance and audacity have shoved the institutionalized thievery of Corporate America’s ever-grasping top execs off into the shadows.
Those shadows could hardly be more welcome. American corporate executive compensation, as the business journal Fortune has just detailed, is now “surging amid a roaring bonus rebound.”
Heads CEOs win, in other words, tails they never lose.
One example: Tyson Foods CEO Donnie King has seen his annual executive rewards leap from $13 million in 2023 to $22.7 million in 2024. To keep King smiling, Tyson’s board of directors has also extended his CEO contract into 2027 and guaranteed him “a post-employment perk that includes 75 hours of personal use of the company jet as long as he sticks around on the board.”
And what in the way of wonders has Tyson’s King been working to earn all this? Not much, concludes a new Compensation Advisory Partners analysis. Anyone who had $100 invested in Tyson shares at the end of fiscal 2019 today holds a nest egg worth just $80.54. Tyson’s most typical workers aren’t doing particularly well either. They took home $43,417 in 2024, 525 times less than the annual compensation that CEO Donnie King pocketed.
Over at Moderna, Big Pharma’s newest big kid on the corporate block, chief exec Stéphane Bancel saw his 2024 annual pay jump 16.4% over his 2023 compensation despite a 53% drop in Moderna’s annual revenue.
Back in 2022, at Covid-19’s height, Bancel personally collected over $392 million exercising stacks of the stock options he had been sitting upon. Between that year’s start and 2024’s close, Moderna shares plummeted from just under $254 each to under $42.
Moderna’s transition to our post-Covid world, the Moderna board acknowledges, has been “more complex than anticipated.” That complexity, the board apparently believes, in no way justifies denying Bancel his rightful place among Big Pharma’s top-earning CEOs. Bancel’s near $20-million 2024 payday is keeping him well within hailing distance of all his Big Pharma peers.
How can corporate CEO paychecks be continuing to go gangbusters while the corporations these execs run are—at best—just treading water? Lauren Peek, a partner at Compensation Advisory Partners and a co-author of the firm’s latest CEO pay analysis, has an explanation.
Corporate board compensation committees, Peek observes, want to keep their top execs adequately incentivized. These board panels simply cannot bear the sight of their CEOs getting down in the dumps. So what do these panels do? They exclude from their final CEO pay decisions any negative economic factors that CEOs can’t directly determine. But these same corporate panels never take into account unexpected positive economic factors that their CEOs had no hand in creating.
Heads CEOs win, in other words, tails they never lose.
Among those winners: Disney chief exec Robert Iger. His 2024 total pay jumped to $41 million, up nearly $10 million from his 2023 compensation. Disney’s total shareholder return, over that same year, didn’t even reach halfway up the total return that Disney’s peer companies recorded.
Disney hardly rates as an outlier among the 50 major publicly traded corporations that the recently released Compensation Advisory Partners report puts under the microscope. The median revenue growth of these 50 firms dropped to 1.6% in 2024, less than half their 2023 rate. Their earnings remained virtually flat as well. But their CEO compensation climbed an average 9%.
“With financial performance largely flat across these early Fortune 500 filers,” notes an HR Grapevine analysis of the Compensation Advisory Partners findings, “board-level decisions to maintain or raise executive bonuses may prompt further scrutiny from investors and stakeholders alike.”
“For ‘shop-floor’ employees,” adds the HR Grapevine, “news of CEO wage hikes despite average financial performances will undoubtedly prompt a good deal of rumination about their own levels of compensation.”
Equilar, an information services firm specializing in corporate pay, has also been busy analyzing the latest trends in CEO remuneration. Equilar’s latest look at corner-office compensation has found that median CEO pay within the corporations that make up the Equilar 500 jumped up from $12 million in 2020 to $16.5 million last year.
CEO-worker pay gaps have increased even more significantly. At the median Equilar 500 corporation, CEOs pocketed 186.5 times the pay of their most typical workers in 2020 and 306 times that pay in 2024. At America’s larger corporations—those companies sitting at the 75th percentile of the Equilar 500—CEOs made 307.5 times their typical worker pay in 2020 and last year collected 527 times more.
A key driver of this ever-widening CEO-worker pay gap? The sinking compensation going to typical corporate workers, as Equilar’s Joyce Chen concluded last week in an analysis for the Harvard Law School Forum on Corporate Governance. These median workers took home $66,321 in 2020, but just $57,299 last year.
But top execs aren’t just shortchanging workers at pay-time. They’re also pressuring those workers to squeeze and defraud clients and customers at every opportunity, as former Wells Fargo bank manager and investigator Kieran Cuadras has just vividly detailed.
Nearly a decade ago, Cuadras relates, a mammoth phony accounts scandal at Wells Fargo led to fines totaling $20 million against the bank’s then-CEO John Stumpf. But those fines, she points out, hardly made a dent in the estimated $130 million that Stumpf “walked away with in compensation when he resigned.”
Wells Fargo’s current CEO, Charles Scharf, appears to be doing his best to follow in Stumpf’s footsteps. Scharf’s gutted risk and complaint departments are cutting corners “to create the illusion of fewer complaints.” The reality: Those departments are closing complaint cases prematurely. In 2024, these and other sneaky moves helped Scharf pocket a sweet $31.2 million .
Our nation’s political leaders, says Wells Fargo employee and customer advocate Kieran Cuadras, need “to step up and do something about a CEO pay system that rewards executives with obscenely large paychecks for practices that harm workers and the broader economy.”
Where to start that stepping up? Lawmakers ought to be levying new taxes on corporations “with huge gaps between their CEO and worker pay,” Cuadras posits, and increasing an already existing tax on stock buybacks.
Moves like these, she astutely sums up, “would encourage companies to focus on long-term prosperity and stability rather than simply making wealthy executives and shareholders even richer.”
This work is licensed under a Creative Commons Attribution-Share Alike 3.0 License.
Sam Pizzigati veteran labor journalist and Institute for Policy Studies associate fellow, edits Inequality.org. His recent books include: The Case for a Maximum Wage (2018) and The Rich Don't Always Win: The Forgotten Triumph over Plutocracy that Created the American Middle Class, 1900-1970 (2012).
Full Bio >
Every day’s headlines now seem to bombard us with ever more outrageous Trumpian antics. Who could have possibly imagined, for instance, that a president of the United States would turn the White House lawn into a Tesla auto showroom?
But these antics actually do serve a useful social and political purpose—for President Donald Trump’s fellow deep pockets and the corporations they run. Trump’s kleptocratic arrogance and audacity have shoved the institutionalized thievery of Corporate America’s ever-grasping top execs off into the shadows.
Those shadows could hardly be more welcome. American corporate executive compensation, as the business journal Fortune has just detailed, is now “surging amid a roaring bonus rebound.”
Heads CEOs win, in other words, tails they never lose.
One example: Tyson Foods CEO Donnie King has seen his annual executive rewards leap from $13 million in 2023 to $22.7 million in 2024. To keep King smiling, Tyson’s board of directors has also extended his CEO contract into 2027 and guaranteed him “a post-employment perk that includes 75 hours of personal use of the company jet as long as he sticks around on the board.”
And what in the way of wonders has Tyson’s King been working to earn all this? Not much, concludes a new Compensation Advisory Partners analysis. Anyone who had $100 invested in Tyson shares at the end of fiscal 2019 today holds a nest egg worth just $80.54. Tyson’s most typical workers aren’t doing particularly well either. They took home $43,417 in 2024, 525 times less than the annual compensation that CEO Donnie King pocketed.
Over at Moderna, Big Pharma’s newest big kid on the corporate block, chief exec Stéphane Bancel saw his 2024 annual pay jump 16.4% over his 2023 compensation despite a 53% drop in Moderna’s annual revenue.
Back in 2022, at Covid-19’s height, Bancel personally collected over $392 million exercising stacks of the stock options he had been sitting upon. Between that year’s start and 2024’s close, Moderna shares plummeted from just under $254 each to under $42.
Moderna’s transition to our post-Covid world, the Moderna board acknowledges, has been “more complex than anticipated.” That complexity, the board apparently believes, in no way justifies denying Bancel his rightful place among Big Pharma’s top-earning CEOs. Bancel’s near $20-million 2024 payday is keeping him well within hailing distance of all his Big Pharma peers.
How can corporate CEO paychecks be continuing to go gangbusters while the corporations these execs run are—at best—just treading water? Lauren Peek, a partner at Compensation Advisory Partners and a co-author of the firm’s latest CEO pay analysis, has an explanation.
Corporate board compensation committees, Peek observes, want to keep their top execs adequately incentivized. These board panels simply cannot bear the sight of their CEOs getting down in the dumps. So what do these panels do? They exclude from their final CEO pay decisions any negative economic factors that CEOs can’t directly determine. But these same corporate panels never take into account unexpected positive economic factors that their CEOs had no hand in creating.
Heads CEOs win, in other words, tails they never lose.
Among those winners: Disney chief exec Robert Iger. His 2024 total pay jumped to $41 million, up nearly $10 million from his 2023 compensation. Disney’s total shareholder return, over that same year, didn’t even reach halfway up the total return that Disney’s peer companies recorded.
Disney hardly rates as an outlier among the 50 major publicly traded corporations that the recently released Compensation Advisory Partners report puts under the microscope. The median revenue growth of these 50 firms dropped to 1.6% in 2024, less than half their 2023 rate. Their earnings remained virtually flat as well. But their CEO compensation climbed an average 9%.
“With financial performance largely flat across these early Fortune 500 filers,” notes an HR Grapevine analysis of the Compensation Advisory Partners findings, “board-level decisions to maintain or raise executive bonuses may prompt further scrutiny from investors and stakeholders alike.”
“For ‘shop-floor’ employees,” adds the HR Grapevine, “news of CEO wage hikes despite average financial performances will undoubtedly prompt a good deal of rumination about their own levels of compensation.”
Equilar, an information services firm specializing in corporate pay, has also been busy analyzing the latest trends in CEO remuneration. Equilar’s latest look at corner-office compensation has found that median CEO pay within the corporations that make up the Equilar 500 jumped up from $12 million in 2020 to $16.5 million last year.
CEO-worker pay gaps have increased even more significantly. At the median Equilar 500 corporation, CEOs pocketed 186.5 times the pay of their most typical workers in 2020 and 306 times that pay in 2024. At America’s larger corporations—those companies sitting at the 75th percentile of the Equilar 500—CEOs made 307.5 times their typical worker pay in 2020 and last year collected 527 times more.
A key driver of this ever-widening CEO-worker pay gap? The sinking compensation going to typical corporate workers, as Equilar’s Joyce Chen concluded last week in an analysis for the Harvard Law School Forum on Corporate Governance. These median workers took home $66,321 in 2020, but just $57,299 last year.
But top execs aren’t just shortchanging workers at pay-time. They’re also pressuring those workers to squeeze and defraud clients and customers at every opportunity, as former Wells Fargo bank manager and investigator Kieran Cuadras has just vividly detailed.
Nearly a decade ago, Cuadras relates, a mammoth phony accounts scandal at Wells Fargo led to fines totaling $20 million against the bank’s then-CEO John Stumpf. But those fines, she points out, hardly made a dent in the estimated $130 million that Stumpf “walked away with in compensation when he resigned.”
Wells Fargo’s current CEO, Charles Scharf, appears to be doing his best to follow in Stumpf’s footsteps. Scharf’s gutted risk and complaint departments are cutting corners “to create the illusion of fewer complaints.” The reality: Those departments are closing complaint cases prematurely. In 2024, these and other sneaky moves helped Scharf pocket a sweet $31.2 million .
Our nation’s political leaders, says Wells Fargo employee and customer advocate Kieran Cuadras, need “to step up and do something about a CEO pay system that rewards executives with obscenely large paychecks for practices that harm workers and the broader economy.”
Where to start that stepping up? Lawmakers ought to be levying new taxes on corporations “with huge gaps between their CEO and worker pay,” Cuadras posits, and increasing an already existing tax on stock buybacks.
Moves like these, she astutely sums up, “would encourage companies to focus on long-term prosperity and stability rather than simply making wealthy executives and shareholders even richer.”
This work is licensed under a Creative Commons Attribution-Share Alike 3.0 License.
Sam Pizzigati veteran labor journalist and Institute for Policy Studies associate fellow, edits Inequality.org. His recent books include: The Case for a Maximum Wage (2018) and The Rich Don't Always Win: The Forgotten Triumph over Plutocracy that Created the American Middle Class, 1900-1970 (2012).
Full Bio >
